IBM's Q3 Software Organic Growth Driven by Progress on Pushed Deals, BofA Says

10:39 AM EDT, 10/22/2026 (MT Newswires) -- International Business Machines' (IBM) Q3 software segment organic growth and higher outlook for the year were driven by progress on deals that slipped from Q2, BofA Securities said in a Thursday research report. IBM reported Q3 adjusted earnings late Wednesday of $2.95 per diluted share, compared with $2.65 a year earlier. Analysts polled by FactSet expected $2.85. Revenue for the quarter was $17.10 billion versus $16.33 billion a year earlier and $16.82 billion estimate. Sustained productivity gains drove solid pre-tax margin improvement from a year earlier, lifting the free cash flow outlook higher, according to the note. Management attributed the transaction processing rebound to deferred transactions and a normal Q3 buying cycle, while recovered deals disproportionately benefited the segment, analysts wrote. The company identified AI-related data growth and infrastructure modernization as demand drivers for storage and power segments, according to BofA. The brokerage said it reiterated its buy rating on the stock and price target of $280 per share. Price: 246.84, Change: -4.63, Percent Change: -1.84